I also have this problem (on kdm), ctrl + alt+ backspace doesn't work. I'm also using the fglrx driver so it might be a driver bug. This bug also reports problems with the nvidia drivers: https://launchpad.net/distros/ubuntu/+source/linux-restricted-modules-2.6.15/+bug/46874 -- Logout proces hangs https://launchpad.net/bugs/38915